Mango DAO Agrees to $700K Settlement with SEC for Unregistered MNGO Token Sale

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Joel Frank

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Joel Frank

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Since graduating with a degree in economics from the University of Birmingham in 2018, Joel has worked as a financial market/cryptocurrency analyst. He firmly believes that emerging crypto technology…

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Last updated:

September 27, 2024 17:15 EDT

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The US Securities and Exchange Commission (SEC) on Friday filed settled charges against Solana dApp Mango DAO and Blockworks Foundation over the unregistered offer and sale of $70 million worth of MGNO token tokens, which the agency deems as crypto asset security.

Without admitting or denying the allegations, Mango DAO agreed to pay the SEC $700,000 and destroy their MNGO tokens.

The decentralized autonomous organization (DAO) will also ask exchanges to halt the trading of MNGO tokens.

The SEC also charged Mango DAO developer Mango Labs LLC for engaging in unregistered broker activity, charges that were also settled.

As part of a statement, the SEC argued that Mango Market’s DAO status did not change the fact that MNGO tokens should have been registered.

“Our view has been that the label ‘DAO’ does not change… whether their activities need to be registered,” the SEC’s Acting Chief of the Crypto Assets and Cyber Unit said.

Mango DAO – Another Victim of the SEC’s Crackdown

Mango DAO is the latest crypto firm/entity to fall fowl of the SEC, which has been crusading to exercise jurisdiction over the industry since 2022 and reign in and industry that it claims is rife with incompliance to securities rules.

In a recent SEC interview on CNBC, SEC Chair Gary Gensler argued that the firm’s dozens of lawsuits against major industry players are intended to create a safe environment for investors.

“This field will not long survive if you can’t build that investor trust in the markets”, he stated.

The SEC Chair has, in the past, expressed his opinion that virtually all cryptos aside from Bitcoin are unregistered crypto asset securities.

The agency begrudgingly approved spot Ethereum ETFs earlier in the year, a tacit admission that they also don’t view Ethereum as a security.

Crypto investors are hoping that the next US presidential term will bring with it more favorable crypto industry policy – the Biden administration has been a stanch supporter of the SEC’s aggressive anti-crypto stance.

Republican Presidential nominee Donald Trump has come out as ardently pro-crypto in 2024, throwing his support behind Bitcoin, and promoting a DeFi project created by a group involving his sons called World Liberty Financial.

Sitting VP and Democrat Presidential nominee Kamala Harris, meanwhile, hasn’t said much about crypto, beyond her desire to nurture innovation in the space.